Democrats Debate in Iowa

Summary

Richardson claimed “enormous progress” in New Mexico education, when in fact the state’s eighth-grade reading scores have slipped and remain among the worst in the U.S.

Richardson exaggerated the extent to which his state’s teacher salaries increased.

Richardson said one-third of U.S. health care spending goes to “administration and bureaucracy,” but Medicare officials put the figure at 7.4 percent.

Dodd criticized “the Chinese government” for slave labor, when in fact it just sentenced a slaver to death.

Dodd said University of Iowa costs have gone up 141 percent in six or seven years; we find they rose 81 percent.

Obama claimed Medicare would save “a trillion dollars” if fewer Americans were obese. We find little support for that figure.

Analysis

This was the final debate among Democratic candidates prior to the Iowa caucuses. It was held Dec. 13, sponsored by the Des Moines Register and televised on national cable networks.New Mexico Gov. Bill Richardson added to his string of inflated, false or dubious claims.

School Puffery

On education, Richardson once again repeated his unsubstantiated claim that U.S. students rank 29th in the world in math and science, which we first debunked in September. And he made these inflated claims about his own record on education:

Richardson: Well, we’ve made enormous progress in my state. We were 49th in the world in – in the country in teacher salaries. We’re 28th today. Educational achievement has increased.

The salary claim is not true, according to the National Education Association’s Rankings & Estimates report. Pay has improved, but not that much. New Mexico’s teacher pay ranking was 44th the year before he took office and now is 36th, according to the most recent report.

It’s true that educational achievement has increased since Richardson took office in 2003, but not by much. And in the case of reading scores for eighth-graders, the state has actually lost ground. In 2002, for example, 36 percent of New Mexico eighth-graders scoredbelow basic levels in reading in the National Assessment of Educational Progress. This year it was even worse; 38 percent failed to achieve basic reading competency. That’s hardly “enormous progress,” and New Mexico remains in the national test-score basement.

The state’s eighth-graders were in a statistical tie with five other states for next to last among the 52 states and jurisdictions covered. Their reading scores weren’t statistically different from those of Mississippi or Alabama. Only the District of Columbia scored significantly worse.

A Shaky Claim on Health Spending

Richardson used a questionable figure on health care costs, saying that “one-third” of the $2.2 trillion spent on health care “goes to administration and bureaucracy.”

The Centers for Medicare and Medicaid Services does project that health care spending in the U.S. will be more than $2.2 trillion in 2007. But the figure for administrative spending given by CMS’ National Health Expenditure Data tables is far lower than one-third. The data show 7.4 percent of all national health expenditures in 2007 will go to “program administration and net cost of private health insurance.” (Net cost is the difference between benefits and premiums.)

Richardson’s statistic does have some support, however. A survey conducted by PNC Financial Services Group, which says it’s “a leading provider of electronic financial services to the health care industry,” said that nearly a third of expenditures went to administration. But that finding, released this year, was merely the opinion of the 200 hospital and insurance company executives queried. “There was no hardcore data or a number that they have,” confirmed PNC spokeswoman Amy Vargo.

Also, a 2003 article in the New England Journal of Medicine said that in 1999, 31 percent of health care expenditures went to administration. The authors included indirect costs, such as an estimate for the time physicians spend on administrative work.

Greenhouse Gasbag

Richardson blithely claimed he would slash greenhouse gases:

Richardson: Also, we need to reduce greenhouse gas emissions, and I would do so by 90 percent with a cap-and-trade program.

What Richardson didn’t say is that he isn’t promising to achieve that 90 percent reduction until 2050, a detail we found on his Web site. Richardson didn’t specify what his plan would do to the prices of electricity, manufactured goods and so on, saying only that he would be “asking the American people to sacrifice a little bit.” But according to one recent estimate, a less ambitious plan now pending in the Senate could cost the average household the equivalent of $800 to $1,300 a year in today’s dollars by 2015. That’s just one guess, of course. But there’s little doubt it would require more than “a little bit” of sacrifice to accomplish a 90 percent cut.

Dodd: When you have the Chinese government, as they just did, even make it more difficult for us to access even entertainment, not to mention, of course, the intellectual property theft that goes on on a daily basis; here you’re still using slave labor; you know, you manipulate your currency to give you a 40 percent advantage over our manufacturers and our people working in this country here, that’s no longer just a competitor. That’s a very different relationship.

Dodd is right that slave labor exists in China. In June 2007, a group of parents in Shanxi Province discovered that owners of many of the region’s brick kilns were kidnapping and enslaving children, forcing them to work up to 18 hours per day. But Dodd is wrong to suggest that the Chinese government is sanctioning slavery. Nearly 35,000 police officers descended on Shanxi province, raiding more than 7,500 work places. And less than a month after the story garnered international headlines, Chinese courts had sentenced 28 overseers at the kiln to prison and ordered another executed.

We agree that enslaving children is reprehensible, but Dodd was wrong to suggest that the Chinese government condones the practice.

Dodd Fails Math

Dodd also miscalculated when he said, “the cost right here at the University of Iowa has gone up 141 percent the last six or seven years.” The costs went up, but not nearly by that much.

In 2000, an in-state student could expect to pay $7,503 a year for tuition, room and board, and the school lists the current figure at $13,543. That’s an increase of 81 percent. For out-of-state students the cost of tuition, room and board has gone from $15,265 to $26,715, an increase of 75 percent.

Big Fat Trillion

Sen. Barack Obama of Illinois used an estimate of uncertain provenance when discussing Medicare savings:

Obama: If we went back to the obesity rates that existed in 1980, that would save the Medicare system a trillion dollars.

Obama got this claim from a “candidate briefing book” put out by the Center for American Progress, a liberal think tank run by former Clinton chief of staff John Podesta. CAP cites the CDC and the Commonwealth Fund as sources for the estimate, but representatives from both organizations told us that the claim was unfamiliar to them.

We worked up our own back-of-the-envelope estimate, using official figures. The Centers for Disease Control and Prevention officially estimates that obesity cost $75 billion in 2003. The CDC also says that “approximately half” of the cost burden for both overweight and obese people is borne by Medicaid and Medicare. Obesity rates doubled between 1980 and 2000, also according to the CDC. So if obesity rates returned to “rates that existed in 1980” they would be cut in half, and that in turn would imply that Medicare and Medicaid together (not just Medicare alone) would save about a quarter of $75 billion, or roughly $18.75 billion per year.

Correction, Dec. 14: In our original article, we said that a New England Journal of Medicine piece was published in 1999. The article was about 1999 data, but it was published in 2003. We also mistakenly referred to Bill Richardson as the former governor of New Mexico.